The World's Unsexiest Business

​The calm before the storm?
Before consumer euphoria starts to set it, just remember that volatility always returns to its natural 'mean' level.

While prices at the pump aren't anywhere near absolute historic lows (sub $2 nearly 10 years ago), they are sitting in relatively cheaper territory (slightly shy of $3) but still above the average price (~$2.80) around this time last year.

Addressing the tracking error between crude and RBOB (the 'crack' spread), this particular spread has seen an increased ebb and flow. Currently, we're sitting somewhere in the middle after having seen a dramatic spike a couple of days prior to the new year.

Source: Quandl

Many of my blog posts going forward will refer to the convergence / divergence of relative and absolute prices inside and outside the store.